by: Mario Jauregui
True or False
When it comes to money, there are two rules: (1) More is
better than less and (2) sooner is better than later.
TRUE
Multiple Choice
Rate of return that exactly equates the investment outflows
with the investment inflows once we consider the timing f the cash flows.
Internal Rate of Return (IRR)
Break Even Point
Present Value
Time Value of Money
Internal Rate of
Return (IRR)
True or False
Equation for IRR is PVo=FVn(1+r)n
FALSE -> FVn=PVo(1+r)n
Multiple Choice
An annuity is ___________________________________.
(A) Systematic reduction of debt through a series of scheduled principle
repayments
(B) That
portion of investment cash inflow designated as the interest earned
on
investment capital
(C) Specific
type of income stream characterized by equal periodic payments
over
its life.
(D) Discounted
value of income–producing asset considering both cash inflow
to
the asset owner and cash outflows from the asset owner.
C
True or False
Amortization is the
process of determining the future value of an income stream by applying
appropriate time value of money concepts.
FALSE-> The systematic reduction of debt through a
series of scheduled principal repayments that lead eventually to the complete
extinction of the loan.
True or False
It is important to
plan for future needs and setting aside the appropriate amount each year can
help with capital investments. In other words, upkeep is necessary.
TRUE
Multiple Choice
What is the formula
for discounting annuities?
(A)
MP=MBo{(r/m)/[1-(1+r/m)-N*M]}
(B)
a=FVa{r/[(1+r)n-1]}
(C)
a=PVa{r/[1-(1+r)-n]}
(D)
PVa=FVn(1+r)-n
D
True or False
The real estate decision
aid is a set of tools based on the concept of time value of money.
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ReplyDeleteCharles A
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